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Court of Criminal Appeal 24 May 2011

Agius v R; Abibadra v R; Jandagi v R; Zerafa v R

[2011] NSWCCA 119

Also reported as (2011) 80 NSWLR 486
Fraud & dishonesty
CRIMINAL LAW WHETHER SECOND COUNT FOREDOOMED TO FAIL NATURE OF CONSPIRACY CONTINUING OFFENCE PHYSICAL ELEMENT OF S.135.4(5) OFFENCE "STATE OF AFFAIRS"

Citation: Agius v R; Abibadra v R; Jandagi v R; Zerafa v R [2011] NSWCCA 119
Court: NSW Court of Criminal Appeal
Date: 24 May 2011
Judges: Tobias AJA, Johnson J, Hall J

Background

Four accused were charged on a single indictment containing two counts of conspiracy, both arising from what the prosecution alleged was a single, continuous tax fraud. The fraud involved an offshore accountant, a Sydney accountancy firm, and associated employees and associates, and was alleged to have run from January 1997 to April 2008.

The reason for two counts rather than one was a change in the relevant legislative regime. Count 1 covered the period up to 23 May 2001 and charged conspiracy to defraud the Commonwealth under the Crimes Act 1914 (Cth). Count 2 covered 24 May 2001 onwards and charged the equivalent offence under s 135.4(5) of the Criminal Code 1995 (Cth), which came into force following the Law and Justice Legislation Amendment (Application of Criminal Code) Act 2001 (Cth).

Before trial, all four accused applied to Simpson J in the Supreme Court for a permanent stay of Count 2, arguing that it was foredoomed to fail. Simpson J refused the application. The accused then sought leave to appeal that refusal to the Court of Criminal Appeal under s 5F of the Criminal Appeal Act 1912, with the matter heard urgently given the imminent trial date.

  • Whether leave to appeal against Simpson J's interlocutory refusal of a permanent stay should be granted under s 5F of the Criminal Appeal Act 1912.
  • Whether Count 2 was "foredoomed to fail" within the principles in Walton v Gardiner, such that a permanent stay was warranted.
  • Whether s 135.4(5) of the Criminal Code required the Crown to prove a fresh agreement entered into after 24 May 2001, or whether the continuation of a pre-existing conspiracy after that date could satisfy the physical element of the offence.
  • Whether the physical element of s 135.4(5) could be satisfied by a "state of affairs" (the continuation of an existing conspiracy) rather than requiring proof of a new act of agreement within the charged period.
  • Whether Simpson J correctly applied the transitional provisions governing the shift from the Crimes Act to the Criminal Code regime.

Decision

Johnson J (with whom Tobias AJA and Hall J agreed) granted leave to appeal but dismissed the appeals. The Court accepted that the issues raised were sufficiently important to pending prosecutions generally to justify granting leave, notwithstanding the usual reluctance to interrupt criminal proceedings through interlocutory appeals.

On the central question, the Court held that the accused had not demonstrated that Count 2 was foredoomed to fail. The threshold for a permanent stay on that basis is demanding: the proceedings must be clearly seen to be foredoomed to fail, or must inevitably and manifestly fail. That threshold was not met here.

The key issue was whether s 135.4(5) of the Criminal Code required proof of a fresh agreement formed after the Code came into force. Johnson J accepted Simpson J's reasoning that the physical element of the offence could take the form of a "state of affairs," including the continuation of an existing conspiracy into the charged period. Because conspiracy is a continuing offence, the accused's ongoing participation in the alleged conspiracy after 24 May 2001 could in principle satisfy the physical element without requiring a wholly new agreement.

The Court also rejected the accused's argument that Simpson J had misapplied the transitional provisions. Her Honour's analysis was found to be correct. Separately, the Crown had submitted before this Court that Simpson J erred in rejecting a Crown argument based on the past tense in s 135.4(9)(a). The Court of Criminal Appeal also rejected that Crown submission, finding Simpson J's reasoning on that point persuasive.

Orders Made

  • Leave granted to the applicants under s 5F(3)(a) of the Criminal Appeal Act 1912 to appeal against the interlocutory order of Simpson J refusing a permanent stay of Count 2.
  • Appeals dismissed.

Key Takeaways

  • A permanent stay of criminal proceedings on the basis that they are "foredoomed to fail" remains an exceptional remedy, available only where the prosecution can clearly be seen to be inevitably and manifestly bound to fail (Walton v Gardiner).
  • Under s 135.4(5) of the Criminal Code, the physical element of the conspiracy offence can be satisfied by a "state of affairs," meaning the continuation of a pre-existing conspiracy into the charged period may suffice without proof of a fresh agreement formed after the new legislative regime commenced.
  • Conspiracy is treated as a continuing offence, and the introduction of a new legislative regime during the course of an alleged conspiracy does not automatically require the Crown to prove a wholly separate agreement for the period governed by the later legislation.
  • No error was established in Simpson J's application of the transitional provisions governing the shift from the Crimes Act 1914 (Cth) to the Criminal Code 1995 (Cth) conspiracy offences.
  • Leave to appeal under s 5F may appropriately be granted where a question of statutory construction has significance for a number of pending prosecutions, even where the merits ultimately favour dismissing the appeal.

Legislation and Cases Referenced

Legislation:
- Criminal Appeal Act 1912 (NSW), s 5F
- Criminal Code 1995 (Cth), s 135.4(5), s 135.4(9)(a)
- Crimes Act 1914 (Cth), s 86(1), s 29D
- Law and Justice Legislation Amendment (Application of Criminal Code) Act 2001 (Cth)
- Interpretation Act 1901 (Cth)

Key Cases:
- Walton v Gardiner [1993] HCA 77; 177 CLR 378
- Jago v District Court (NSW) [1989] HCA 46; 168 CLR 23
- Williams v Spautz [1992] HCA 34; 174 CLR 509
- Doney v The Queen [1990] HCA 51; 171 CLR 207
- The Queen v LK [2010] HCA 17; 241 CLR 177
- Director of Public Prosecutions v Doot [1973] AC 807
- R v Petroulias [2007] NSWCCA 134; 73 NSWLR 134
- R v Petroulias (No 1) [2006] NSWSC 788; 177 A Crim R 153
- R v Jasper [2003] NSWCCA 186; 139 A Crim R 329
- R v King [2003] NSWCCA 399; 59 NSWLR 472
- R v Einfeld [2008] NSWCCA 215; 71 NSWLR 31
- R v Steffan (1993) 30 NSWLR 633
- R v Matovski (1989) 15 NSWLR 720
- R v Agius; R v Abibadra; R v Jandagi; R v Zerafa [2011] NSWSC 367